There doesn't seem to be much dispute that the attempts to point to job or investment projections as somehow justifying corporate tax slashing (in the face of a decade's worth of evidence that they don't much help) are off base. But what about the argument that corporate taxes should be accepted because their main effect is on workers in the form of wages?

Let's assume for a moment that it's true that all corporate tax reductions will be returned to workers in the form of increased wages, and ask whether the result is one that we'd see as fair or desirable with a focus on how the benefits would figure to be distributed.

To test who figures to benefit most, the first obvious question is that of which industries have the most profits which would be subject to reduced taxation. There, two obvious answers appear: the financial and resource sectors, each of which (on a quick look) takes in roughly a quarter of all Canadian corporate profits.

How many workers will then be in line to benefit when half of a corporate tax cut goes to those sectors? According to StatsCan's chart of employment by industry, just under 2% of all Canadian workers are in the resource sector, and approximately 6.3% in the financial sector. So assuming that a corporate tax cut doesn't somehow alter the expected distribution of profits by industry, the result of a corporate tax cut is to deliver 50% of the expected wage benefits to just over 8% of all workers (and in sectors which are already far from hurting).

Meanwhile, there would be something close to zero anticipated benefit for large segments of the population such as the 21% of all workers who work in the public sector, the 15.5% who are self-employed, and anybody in a sector with a high ratio of workers to profits.

Now, the above division is undoubtedly oversimplified, as there would figure to be spillover effects based on mobility between industries. But the basic point is that an attempt to argue for corporate tax cuts on the basis that they'd be expected to raise wages looks to leave out an important part of the picture. And for those of us who don't count trader bonuses as evidence that the working class is getting ahead, there's ample reason for suspicion that the real effect of corporate tax cuts is only to make inequality worse - even if it does result in something that can theoretically be defined as wage gains.

- James Travers offers his take on how the Cons' attacks on the Bloc may have long-term ramifications:

Lost in all that noise is a counter-intuitive truth. There is no bigger bargain than chanelling rogue and destructive forces into legitimate and constructive political practices.

Canada has been redirecing that negative energy since the 1970 October crisis. Stunned by bombs and murder, Canadians, led by Quebecers, rejected violence as an acceptable expression of political will.

Such collective wisdom is rare and priceless. Blessed among nations, Canada has skirted the civil unrest and war that divides families and ruins economies.

By any measure, what’s happened over the past 40 years has been extraodinary. In Quebec, the Parti Quebecois has won majorities four times, often providing good government and never achieving its indepence goal. In Ottawa, the Bloc Quebecois became Her Majesty’s Loyal Oppostion in 1993 - a remarkable development requiring a nationalist movement to swear allegiance to the conquering Crown - and since then has earned a reputation for working respectfully and well within a structure it wants to change.

- Which isn't to say that there aren't some serious problems with the Bloc as it stands. But as Gerald Caplan notes, the larger problem is that a party which once prided itself in standing on principle (anybody remember the strains of "if only the Bloc ran candidates outside Quebec" from elections past?) has engaged in numerous embarrassing sell-outs:

On a series of issues both important in themselves and emblematic of the worrisome direction Canada and Quebec are taking, the Bloc and PQ have stooped to embracing retrograde positions based on flagrant opportunism.

Take the government’s F-35 stealth-fighter plane deal. It will cost a vast fortune and yet no persuasive case for this choice has ever been spelled out, except for the powerful lobbying of both the United States and retired officers from the senior ranks of the Canadian military now enriching themselves in the private sector. Given the Bloc’s usual response to public policy issues, a thoughtful, well-articulated opposition to this feckless deal was expected. In fact, however, the Bloc is an enthusiastic cheerleader for the F-35s, for no known reason beyond the number of aerospace companies located in Quebec....(A) remarkable campaign has been going on in Quebec with the entire provincial medical and public-health establishment calling for an end to asbestos mining and exports. A recent poll showed the public has been moved: 76 per cent of Quebeckers opposed financing the mine with only 14 per cent in favour. Who this tiny minority includes may come as a shock. The strongest pressure on Mr. Charest to support the mine comes, incredibly enough, from the Quebec trade-union movement, in as great a betrayal of working people as can be imagined. The former president of the Quebec Federation of Labour was actually hired as the president of the registered lobby group for the Quebec asbestos industry, the Chrysotile Institute, which, as it happens, the Harper government funds. Solely because of the unions’ position, the PQ and the Bloc, despite knowing full well the lethal consequences, support the continued export of asbestos. International solidarity with poor working people around the world, non! Solidarity with Stephen Harper, oui!

Then there’s the disappointing Bloc position on attempts to streamline the Canadian Access to Medicine Regime (CAMR). This was once a well-meaning attempt to encourage generic drug manufacturers to supply low-cost AIDS drugs to Africa. But thanks to the pressure from the giant brand-name drug companies, it was rendered virtually useless. Yet CAMR can easily be made more viable, and when the House reconvenes next week, one of the first items of business will be an NDP motion to make it so. Another no-brainer for a Bloc that explicitly trumpets its concern for social justice for poor countries, n’est-ce pas?

But look again at the F-35 issue and how easily special interests in Quebec trump both social justice and commonsense. Besides aerospace, Quebec happens also to be rich in Big Pharma companies. Very Big Pharma. So big in fact that it’s got the Bloc playing deadly political games on the AIDS drug issue. As of now, the Bloc intends to offer an amendment to the proposed NDP bill, a sly sunset clause whose effect will be to deter generic drug manufacturers from using the bill at all. Caving in to Big Pharma pressure, the Bloc may actually be prepared to undermine a reformed CAMR, with all that implies for those dying from AIDS in Africa.

- Meanwhile, Andrew Coyne's take on what Canadians can know about a Con government that's been in power for five years is almost entirely on target:

There is no tension in Canadian politics, no shape or boundaries to it. Other governments, at other times and in other countries, have made decisions for political reasons, sometimes base ones. But they were constrained in this regard by other imperatives: the need to hold their cabinet together, or their caucus, or their base, or at any rate their dignity. There were consequences, in other words, and as such there were limits. But such is the insouciance, not to say eagerness, with which the Harper government has shrugged off its previous positions, and such is the leeway granted it by a Conservative party desperate for the spoils of undivided power, that all such reference points have vanished.

Five years after it took office, it is literally impossible to predict with any certainty what this government will do on any given issue. That, I suppose, is its record.

But I'd add the caveat that while the Cons' initial decision may be difficult to predict, their subsequent actions once a position has been declared are rather easy to see coming. And there's no reason why the predictable cycle of refusal to admit to error or even the existence of other perspectives shouldn't have come back to bite the Cons by now.

- And finally, Susan Delacourt responds to Coyne by noting what the Cons themselves fear most (as well as how we can tell they're running scared):

It's good to see a couple of columnists stepping out from behind the wall of assumptions/talking points in federal politics, which blithely assert that whenever the current government is doing something -- negative ads, spending wildly -- it's doing it from a position of strength. Those silly ads this week, in violation of every private-sector advertising standard (and now pulled), told me something different. Strong, confident political parties don't go on the attack for the sheer joy of it. (Well, maybe political parties composed of 14-year-olds in their basements do, but presumably there are adults in the room somewhere in Conservative Ottawa.)

Every party has attack ads -- true. Liberals had some nasty ones held in reserve always through the campaigns of the 1990s and up to this day. But I think we're forgetting a cardinal rule of politicking -- attack ads are desperate measures, used when absolutely necessary to chip away at an opponent's advantage. If they're being released now, what exactly is the Conservative party seeing to fear out there? And that takes us back to Coyne's column: if your government is all about keeping power, then your biggest fear must revolve around losing it.

Con Environment Minister Rona Ambrose not so long ago, warning of the desperate need for legislation to allow the federal government to deal effectively with greenhouse gas emissions:

When Canada's Clean Air Act passes, we will have the power to:

- set fuel efficiency standards in the auto sector- establish national air quality objectives based on health and be accountable for reaching them- be accountable to Parliament by reporting on annual progress- be accountable to Canadians through an annual report on air quality- be able to regulate products that create emissions such as woodstoves and gas-powered lawnmowers- be able to blend fuels so we can offer Canadians cleaner fuels like ethanol and biodiesel and give our farmers opportunity to participate in the renewable fuels industry- be able to regulate indoor air for radon, which is the leading cause of lung cancer among non smokers.- be able to issue mandatory reporting notices on products that cause pollution and require companies to report on their human health and environmental impacts- be able to issue interim emergency orders to shut down polluters if we believe immediate action is needed- it will expand the inspection powers of our enforcement officers- companies will no longer be able to voluntarily report to government, they will have to have independent verification and evaluation of their pollution information- we will introduce new energy efficiency requirements and labeling requirements for 20 new consumer products such as washing machines and dishwashers and electronic products like televisions and DVD players....Our health has suffered long enough and our environment has suffered long enough. We need Canada's Clean Air Act to make real progress for my generation and the generations that come after me.

Canada's Clean Air Act is an essential tool in this government's commitment to achieving concrete results on air quality and climate change in the short, medium, and long-term.

This legislation will give us the means to put in place new enforceable regulated requirements to reduce emissions and take coordinated action to reduce air pollution and greenhouse gases. It sets out important amendments to the Fuels Division of the Canadian Environmental Protection Act.

Which brings us to...Con Environment Minister Peter Kent today, declaring that it's ridiculous to suggest that legislation is needed to allow the federal government to deal effectively with greenhouse gas emissions:

As an aside, just weeks into this job let me say how especially frustrating I find the constant, critical refrain that this Government has no environmental plan.

Not only do we have one, we are one of the very few countries that does.

What many people don’t realize is that Environment Canada already has the legal tools it needs to execute our plan. It requires no new legislation.

- Aaron Wherry nicely documents the conflicting interpretations being applied to Jack Layton's take on the impending Con budget.

- Trish Hennessy weighs in on how to talk about corporate tax cuts, and points out Layton as an example of frame the issue:

During his Lang and O’Leary interview, (Jack) Layton was particularly strong on this aspect: that the corporate tax cuts are a giveaway with no guarantee of new jobs. He talked about corporations that have taken the tax cuts already doled out and left Canada to do business elsewhere.

This approach to the issue reinforces what I've heard over several years of focus group research: Canadians don’t trust corporations to do what is in the best interest of the people. A corporation's bottom line is profit. There’s much to be mined by exploring that angle within a progressive frame on corporate tax cuts.

What I've also learned through focus group research is that Canadians often take a position based on how we rate compared to others. They would be very surprised to learn that Canada's corporate taxes aren't high compared to OECD competitor nations. Canadians are, at heart, pragmatic people. They're unlikely to support a race to the bottom, especially if it affects our high quality of life -- something Canadians take pride in.

So, tapping into national pride, pragmatism, and fairness while maintaining a focus on prudent fiscal measures to protect public programs we love, such as health care -- these are the ingredients of effective progressive messaging on corporate tax cuts.

- Finally, much as I normally enjoy Dan Gardner's writing, I'd argue that his latest goes off the rails in at least his example and arguably his premise about how to go about analyzing political leaders:

If it’s true that Michael Ignatieff intends to form a coalition should the Conservatives fail to win a majority, and if it’s true that Stephen Harper plans on unleashing his inner ideologue if they do, does that mean Canada will necessarily get one undesirable outcome or the other? No. Because there is a vast gulf between leaders’ intentions for the future and what they ultimately do when the future finally arrives.

Imagine it’s September 7, 2008. The Prime Minister has just asked the governor general to call an election. You sit down with Stephen Harper and, because you’re old friends, you have a private and frank conversation. What are his plans? What will his government do in the coming years if he is re-elected with another minority?

Of course that’s what actually happened. And we can be reasonably confident Harper would have predicted none of it. Remember, in September, 2008, he was sure there wouldn’t be a recession. The budget would remain balanced. Keynesian stimulus? He’d sooner cut off his left pinky. Prorogue Parliament? Twice? Bizarre. Why would he do that?

Indeed, I will wager that if Stephen Harper, a psychic, and Paul the Octopus had all tried to predict Stephen Harper’s actions after being re-elected, Stephen Harper likely would have done no better, and quite possibly would have been whipped by the psychic, the octopus, or both.

Now, the problem with the Harper example is that at least some of the events were likely predictable if not outright known at the time. After all, isn't much of the explanation for Harper's choice to call the 2008 election when he did based on the reality that a deficit and a recession were in sight, and he hoped to secure a majority before those hit?

But the more general issue is whether our politics are doomed to be limited to the entirely personal question of how a leader will respond to events, or whether it's at least possible to meaningfully discuss a party's values and plans for the future before it arrives. And while past experience may have led us to be rightfully cynical about any party's commitments, I'd argue we'd be best off if there were a few less excuses for broken promises based on "events".

I don't particularly buy the attempt to pretend there actually is much difference between the messages from Thomas Mulcair and Jack Layton on the budget. But to the extent one wants to try to find one, John Ibbitson nicely explains what it figures to mean:

(I)t remains in the NDP’s interest for Mr. Layton to be seen as willing to compromise. For one thing, it keeps him and his party in the news. And it plays to something the party’s internal polling has identified as a possible election asset. Among Liberal voters who might be tempted to vote NDP, the quality of the NDP they most admire is its willingness to work with other parties.

But when the time comes, when the budget is actually released and the corporate tax cuts haven’t been rescinded, the leader will join with the caucus in offering a resounding No.

Both the Liberals and the NDP are taking heart from a poll that showed only 21 per cent of Canadians support the idea of lowering corporate taxes. If they can make the election about those cuts, and almost nothing else, they have a chance of improving their standing after the next election. So defeating the budget that enables them is the obvious first step toward focusing voters’ minds on that one issue.

Barbara Yaffe is eager to see the Coffee Party concept as little more than a fund-raiser. But from what I can tell, it's notably aimed less toward any particular group's message than toward the simple idea of getting people talking more about politics in the broadest sense - with the current lack of public interest in what's going on in Ottawa serving more as the problem to be solved than a barrier to some other goal.

Mind you, it remains to be seen how far Democracy Watch will get with the campaign. But it's still well worth encouraging people to spend a few minutes a day talking about the world around them with the people near them - and if even a slightly higher percentage of Canadians ends up thinking more regularly about how business and government can impact an individual's life, the long-term results should prove to be well worth the effort.

The initial commentary on Abacus' second choice polling has focused on single-party choices. But perhaps the most striking bit of data is the far right column, showing the total number of people willing to move to each party.

There, the NDP has moved from ranking roughly equally with the other parties in past polling, to a stunning nine-point lead over any other party. In fact, the NDP's share of potential support adding together the Abacus respondents' expressed first and second choices is 41% - ahead of the Libs (39%), and within striking distance of the Cons (45%).

Now, it's not particularly new for the NDP to perform well in second-choice polling. And there's obviously a lot of work to be done in shifting that to first-choice support. But for voters who list the NDP second primarily out of a sense that the Libs can draw from a larger pool of potential voters, the latest poll offers significant reason to doubt that's true - and if just a few current Lib supporters start to shift their votes, there's a real possibility of a major realignment.

Thursday, January 27, 2011

I've already noted the obvious bias involved the proposal floated by some Con allies for a tax return check-off party donation system. But in case we needed any further indication that the sole intention is to further benefit the Cons at the expense of other parties, who wants to see what kind of distorted results we'd end up when the CRA itself is distributing political messages on the Cons' behalf?

- Maybe it's true that Stephen Harper doesn't bother paying attention to Canadian media after all: why bother when he's spending tens of millions of dollars for others to do it for him?

- Barbara Yaffe seems to take a huge leap in associating the message with Jack Layton's future plans. But she's right on target in taking up Layton's call to limit the most obvious abuses from the Senate:

Layton's comments on the Senate Wednesday were nuanced and thoughtful.

He noted that a New Democratic Party government would seek to scrap the upper chamber, a mission-impossible project requiring constitutional change.

But, for now, all he wants Prime Minister Stephen Harper to do is stop appointing Conservative hacks to the $90-million-a-year body -- and to ban senators from fundraising for their parties.

These are reasonable requests but almost surely will be rejected by the PM who, having recently acquired a majority in the red chamber, is delighted his government's legislation now will be rubber-stamped by Senate seals....For all his talk of Senate reform, Harper has given red velvet seats to his former press secretary, a Conservative party president, a former national campaign director and a bunch of defeated Conservative candidates.

It's fair for Canadians to assume that, in return for their appointments, partisan senators serve the interests of the Conservative party more than those of taxpayers.

- Meanwhile, John Moore rightly criticizes the Cons' perpetual demand for tax cuts regardless of the timing or budgetary implications:

Taxes are like food. You can slim down a fat guy by putting him on a diet, but when he reaches his ideal weight he still needs to eat. Conservatives are like fiscal anorexics. They just can't stop obsessing over portion reduction.

Cutting taxes inevitably brings about diminishing returns. Ireland was the darling of the international business set thanks to its 12.5% tax rate--up until the country went bust....Naturally the Conservatives and their allies in the business and think-tank communities think lower corporate taxes are always a good idea. Children think not having a bed time is a good idea.

- And finally, Jim Stanford expands on his basis for concluding that more corporate tax slashing may cost up to 46,000 jobs:

Corporate tax cuts have very little positive impact on employment, since they induce very little change in business capital investment spending. Historical evidence in Canada since 2000 (when the corporate tax rate, then 29.1%, began to be dramatically reduced) indicates that business investment has deteriorated since then - whether measured as a share of GDP, as a share of the existing capital stock, or as a share of corporate cash flow.

Indeed, business capital spending in recent years has fallen below realized business cash flow; companies have been accumulating cash and other liquid assets as a result. By the third quarter of 2010, the cash and short-term financial assets of non-financial businesses in Canada had reached $480 billion - almost a half-trillion dollars (source: Statistics Canada Balance Sheet data, CANSIM database). Since the advent of the recession two years earlier, businesses socked away an additional $83 billion in new cash. (This is in stark contrast to the behaviour of consumers and governments during this time, who incurred substantial new debt in order to finance expanded spending.) Further enhancing the cash flow of business, with no strings attached to incremental investment undertakings, will accomplish nothing other than enhancing that large stockpile of idle cash even further.

When governments allocate large sums of revenue to corporate tax cuts, those resources are no longer available to fund other priorities - like extending EI benefits for laid-off workers, investing in infrastructure or housing, or supporting public programs through transfer payments (like health care or education). All of those programs create far more jobs than corporate tax cuts. Therefore, shifting money from EI benefits (or infrastructure or public services) into corporate tax cuts destroys net jobs.

Wednesday, January 26, 2011

One of the below statements is a "stunning new position" that has Tim Naumetz breathlessly speculating that an election is imminent where it wasn't before. The other is the NDP's well-established position as stated by Thomas Mulcair a month ago. See if you can spot which is which.

Quote #1:

“If the budget includes the same type of blind, across-the-board corporate tax cut that the Conservatives have been doing in the past, it is highly unlikely that the NDP caucus would ever be able to support such a budget,” said Mr. Mulcair.

And Quote #2:

“I am one of 36 Members of Parliament in the NDP caucus, I am the finance critic but I will tell you that I would never recommend approving a budget that included the continuation of the blind, across the board tax cuts, that didn’t roll them back, and I know my caucus colleagues well enough to know that it would be highly unlikely that the NDP caucus would ever vote for such a budget,” Mr. Mulcair (said).

To anybody wanting to make a big deal out of Jim Flaherty's statement that he'd never say never to future tax hikes: don't.

Sure, the Cons would crucify an MP from any other party who said the same. But the more public discussion focuses on the question of "which party will cut my taxes most?", the better off the Cons are in the long run - so file this one away as a retort for when the subject can't be avoided, and get back to talking about why the Cons' obsession with tax slashing is itself misguided.

Let's follow up on my earlierposts with a final question as to the NDP's handling of per-vote funding: namely, should it be sufficiently concerned about Con populist messaging to be willing to give ground on the issue if it wouldn't otherwise plan to do so?

Of course, there isn't much doubt that the Cons will continue to trumpet the issue as long as the funding exists. But that doesn't mean the NDP can avoid the effect of the Cons' messaging simply by giving in on one issue: just look how much the opposition parties' many concessions to the Cons' crime agenda have done to stop their posturing on that point.

Instead, if public funding of campaigns is taken off the table, then the Cons will move on to the Senate or other issues as supposed evidence of their populist bona fides - and now with a greater relative advantage in what they can afford to spend to drown out competing messages.

In other words, the question for the NDP is whether to draw the line at party funding or at some other issue in trying to counter the Cons' more general populist positioning. And there's ample reason to see per-vote funding as fitting nicely with plenty of the NDP's other messages.

After all, doesn't the NDP want to promote the general principle that political involvement is a socially valuable activity rather than a purely private interest? Or that public funding is appropriate for such activities to ensure that private wealth doesn't dictate the terms of debate? Or how about that all votes have value and should serve some broader purpose, even if they're directed toward a party who doesn't happen to win the FPTP lottery in a particular riding?

As best I can tell, those are exactly the types of questions where the NDP will need to take on the Cons head-on in order to seriously challenge for populist votes. And they match perfectly with the debate over per-vote funding.

Moreover, the NDP may have some significant strategic interests in taking up the cause based on the arguments the Cons are using against it. Sure, Bloc-bashing plays well among the Reform base - but if the NDP's road to further gains involves winning over a substantial number of current Bloc supporters, might it not help matters to push back against that argument and speak up for the principle that Quebeckers' votes count just as much as those elsewhere? And for all her faults, isn't Elizabeth May relatively open about praising other parties who support her positions - meaning that she may help to validate the NDP as a populist option if it takes the lead on an issue which is obviously vital to her party?

In effect, the debate over per-vote funding looks to be a golden opportunity to start assembling the pieces of the coalition which the NDP will need to put together in order to win power federally. Whereas agreeing with the Cons will serve to win exactly nobody over to the NDP's side, since any move to validate the Harper government's spin will only help to solidify Con support.

As a result, the NDP is best served positioning itself as the defender of the principle that parties ought to be motivated to win broad support through public funding. And while that course of action may not actually serve to save the current per-vote funding (after all, there have been plenty of musings among the Libs' supporters about playing along with the Cons), the strategy should pay off in the long term both in the values emphasized and in the friends won through the effort.

- Erin takes on Jack Mintz' latest set of fact-free tax-cut cheerleading, this time by pointing to Mintz' own apparently-forgotten words about the optimal tax level:

He claims that the revenue loss will be “relatively small” or “relatively insignificant” without actually suggesting a dollar amount (pages 3 and 20). By comparison, the Department of Finance (see Table 3.5), the opposition parties, and even the Canadian Manufacturers and Exporters estimate that this cut will reduce annual corporate tax revenues by $6 billion.

The proposal Mintz now finds so odious is to roll back the federal rate to 18%. With a 10% provincial rate, that would mean a combined rate of 28%!

So, today’s report alleges that there is “little, if any, revenue cost” (page 20) to cutting well below what Mintz himself identified as the “tax-revenue-maximizing rate.” (Finance Canada and I think the revenue-maximizing rate is far above 28%.)

- And even better, Erin is at least getting a few lines in edgewise in CP's coverage of Mintz. Though four lines compared to at least as many full articles dedicated to Mintz is far less than what's needed to provide any semblance of balance to the discussion.

- Carol Goar criticizes the opacity of over a hundred billion dollars in tax breaks currently littering Canada's public policy:

(I)t would be salutary to scrap some (tax breaks). The trouble is neither MPs nor citizens have enough information to evaluate or debate them. Parliamentarians can’t hold the government to account for them. Taxpayers can’t ask that an outdated or inequitable tax expenditure be scrapped in order to preserve a valued program or service.

It’s wrong that these tax preferences are not part of pre-budget consultations. They have an important bearing on the cost of government and the size of the deficit.

It is regrettable that Canadians have to rely to guesstimates and pocket-calculator figures. But what is most disturbing is that a multi-billion component of the nation’s finances is off-limits to the people who pay Canada’s bills.

- Finally, Terence Corcoran, it's time to step away from the Kool-Aid. (Or else provide some evidence for the stunning assertion that innovation has been universally "repressed" since time immemorial.)

Kady is right to note that the Cons should face plenty of questions about why they're spending public money promoting their now-past home renovation tax credit. But she leaves out the most obvious reason why it's a bizarre choice: after all, how can a party possibly keep a straight face lauding a program even while repeatedly rejecting another party's demand to keep it alive?

There looks to be plenty of discussion today about the possibility that the Harper Cons may reverse their previous plans and turn a P3 fund into a source of stadium funding. But it's worth taking a closer look at why the money is just sitting around in the first place:

Federal Conservatives are eyeing an unspent pot of more than $1-billion from the 2008 budget as a way of funding pro-sports venues without coughing up new cash....The $1.25-billion P3 Canada Fund was created in the 2008 budget but has so far only approved two projects – a $25-million road extension in Winnipeg and a $50-million project in the Maritimes to expand emergency radio services. A spokesperson for the fund could not confirm whether Quebec City or the Quebec government submitted applications.

The fund is under the responsibility of Finance Minister Jim Flaherty, who has largely been cool to the idea of federal funding for pro-sports facilities.

So based on their commitment to shovel public money into private hands at every opportunity, the Cons set aside $1.25 billion as part of their work in pushing Canada's budget into the red even before the 2008 recession hit. And in keeping with Jim Flaherty's usual financial prowess, the program was off by a tidy 1,666% in anticipating the level of demand for that money under the initial rules.

Now, the Cons have apparently decided that money previously budgeted for a failed venture doesn't count as new spending. Which might make sense as a rationalization for Con supporters, but hardly looks like a position that any other party should be willing to accept: after all, the choice between putting a billion dollars into stadium funding or reducing Flaherty's deficit is no less real whether or not the money has previously been allocated.

So what we have now is the Cons looking to rely on their previous ineptitude as a means of pushing yet more public money toward their own political interests. And while that may be an entirely predictable result, it's hardly one that should be allowed to pass without challenge.

- Jim Travers shares the theory that the Cons' anti-coalition spin has more to do with their own fears than public perceptions:

Voters have good reasons to be skeptical of Michael Ignatieff. They’re just not the same reasons Stephen Harper is rolling out in ads savaging the Liberal leader as a grasping prodigal son home to seize power in an illegitimate coalition with socialists and separatists....Given the wealth of other available material, the current ads attacking Ignatieff are deliciously — if accidentally — self-revealing. Written between the lines are Conservatives’ fears that, after reflecting on Harper’s parochialism and the Conservative predilection for driving emotional wedges deep into national divisions, Canadians might just respond positively to a cosmopolitan leader committed to Commons cooperation....Offshore coalitions are different from the successful minorities of Canada’s past; they are also no panacea. But as Harper accepted when he tried to topple Paul Martin by joining forces with the NDP and Bloc, coalitions are legitimate.

With another election looming, Harper is trying to turn Canadian sensibilities upside down. Conservative ads nastily argue that those who lug success home in their luggage can’t be trusted and that co-operation is punishable democratic behavior.

But of course, the Cons' odd choice of attacks stands a much better chance of succeeding if it's met with an equally derisive take on coalitions from the Libs rather than an effort to turn the coalition concept into a positive.

- Tasha Kheiriddin makes a point that's well worth keeping in mind (even if one understandably disagrees with her tedious anti-tax ranting):

In the end, you can shut out politics, but it won't shut you out. It will affect the taxes you pay and the schools that educate your kids. We can blame politicians for not knocking on enough doors, and our busy lives for leaving no space for political involvement. But ultimately, it is up to us to take personal responsibility.

Failure to act means leaving the fate of our cities, provinces and country in the hands of those who do take the time. Those people might as well be you.

- The safety of Canada's food is officially being decided by corporate actors, with no input from Health Canada. What could possibly go wrong?

- And finally, the Onion highlights the wealth gap between the rich and the poor as the 8th wonder of the world. But how long will it be before someone on the right actually starts asking us to celebrate and memorialize inequality?

Monday, January 24, 2011

The real story of the past five years isn’t Harper’s success — his poll numbers have hovered below 40 per cent — but the timidity of the opposition in mounting a spirited case for progressive policies that would have sparked wide public support, particularly after the 2008 financial crash exposed the fallacies of neo-conservative tax-cutting and deregulation.

Harper should be getting pummeled for his pro-corporate, anti-people agenda. Instead, he’s strutting about arrogantly accusing his opponents of being disrespectful, even as he heads a government that is the most disrespectful — to the vast majority of Canadians — in our history.

Without completely spoiling my final post on the NDP's response on per-vote party financing, the largest issue seems to me to be the need for the NDP to actually challenge the Cons' idea of populism to shift votes, rather than signalling agreement and thereby validating the Cons' message. And it's a huge plus to see that's exactly what the NDP is doing in linking party funding to the Cons' (and Libs') blatant Senate patronage:

His salary is paid for by party membership fees; his rivals, however, earn taxpayer dollars. “That’s an unfair subsidy,” Mr. Lavigne said. “I’d like to take that up with people and see how they feel about that.”

Indeed, it is a common practice for governing parties to reward their campaign strategists with Senate seats. Stephen Harper is no exception, despite his vow to see senators elected.

The Prime Minister appointed his fundraising guru, Irving Gerstein, to the Red Chamber. As well, he put his long-time campaign director, Doug Finley – whose wife, Diane, is the Human Resources Minister – into the chamber. Ditto for his communications aide, Carolyn Stewart-Olsen in the chamber.

The Liberals do the same. David Smith, who served as campaign director for Jean Chrétien and Stéphane Dion, is in the Senate; he was appointed in 2002 by Mr. Chretien. ...“It’s not just the public financing, which we think has leveled the playing field. It’s taken big money out of politics and it’s led ... to less corruption,” Mr. Lavigne said. “Most of the developed world has some form of it but I know that most of the developed world doesn’t have a taxpayer-sponsored chamber like the Senate where full-time fundraisers and full-time campaign directors sit.”

- Pogge nicely rebuts the effort of the Cons and their media allies to rewrite the Harper government's history of economic mismanagement:

L. Ian MacDonald joins the list of right-leaning pundits intent on cementing the notion that whatever failings Stephen Harper may demonstrate, he's given us competent government and especially where the economy is concerned.

Apart from the five priorities, the principal achievement of the Harper government has been navigating the economy through the dangerous shoals of the Great Recession to the safe harbour of recovery.

Which completely ignores the fact that the Harper government had already created a structural deficit through a combination of profligate spending and injudicious tax cuts before the recession hit. It also ignores the fact that Stephen Harper, Economist Extraordinaire, denied that the Great Recession was even happening until it became undeniable and then claimed that it wouldn't have any impact on Canada. And it ignores the fact that the stimulus package, such as it was, came about because the opposition forced it by threatening to bring the government down unless it changed course.

Oh, and that banking system the Conservatives are fond of bragging about? They didn't build it; they inherited it. All those jobs that have been recovered? If you look under the surface you find that in many cases we've traded permanent, full time, high-paying jobs for part-time or temporary ones.

- Apparently unveiling a party's election readiness is now considered unacceptable posturing by the ever prim-and-proper Cons. Somebody should inform the last party to do so.

- Brian Topp theorizes that the Libs' current weakness may serve to expand the range of political choice available to Canadians for a long time to come:

(O)ne of the many gifts to Canada provided by the steady hollowing-out of the federal Liberal Party under its unbroken string of weak, uninspired and uninspiring leaders since prime minister Jean Chrétien was ousted in a thuggish coup a decade ago is that an enormous amount of political space has been created for Canadians to discover leaders and priorities they can support among Canada’s other mainstream national political parties.

Whatever your political persuasion, that has to be a good thing....If Stephen Harper is defeated in the next election or replaced in the first days of the next Parliament, that will probably stand as his principal achievement – the final breaking of one-party rule in Canada, to the benefit of all citizens.

And as that Vancouver Sun report (listing Jack Layton as by far Canada's most popular leader) suggests, credible, mainstream choices are now available on the opposition bench that don’t require us to hold our noses, close our eyes, and return to the past.

- And finally, in case anybody was worried that the Cons weren't spending enough public money for their own political benefit, we can add $900,000 for news release services to the list.

Eric nicely summarizes how much public funding Canada's political parties actually receive. And it's clear from the full view that the Cons' main goal in trying to eliminate per-vote funding is to exacerbate the inequalities in a system that already favours them:

Combining the per-vote subsidy, the tax credits on donations, and the reimbursements for the 2008 national and local campaigns, the Conservatives would have received about $42.2-million from public sources in 2009, the last year for which complete financial data is available. The Liberals received $28.1-million, the New Democrats $19.8-million, the Bloc Québécois-$8.2 million, and the Greens $4.3-million.

With each party getting $2 per vote from taxpayers, it is a level playing field. But including all sources of public funding makes it far less equitable. In 2009, the Greens would have benefited from about $4.59 in public funding for every vote cast for them in the 2008 election. That amount is $5.91 for the Bloc, $7.75 for the Liberals, and $7.87 for the New Democrats. Because of their strong fundraising organization and the large amount of money spent in the 2008 election, as well as the per-vote subsidy, the Conservatives benefited most from public funding in 2009, at $8.11 per vote.

- Stephen Harper's closest confidants say he'll veer right if he gets the chance with a majority. But it's of course beyond the pale for anybody else to make the point where it might be seen as a criticism.

- Doug Saunders rightly points out that inequality is an even more serious issue on a global scale than a national one. And it's long past time for some concerted effort to counter the class that's fighting to increase it on both levels.

- Which naturally means that some renewed recognition of the value of organized labour in representing the interests of non-elites is in order.

Former Conservative party president Don Plett, now a Tory senator, rejects the notion that the power of the party has become too concentrated in the hands of a few individuals in Ottawa.

He points to the fact that national councillors and the party president are still elected, that riding associations can vote to turf incumbent candidates and that policies are still voted on by members on the convention floor.

That's right: apparently Plett's best examples of the democracy allowed for by the Cons include a rigged process which ensured that not a single incumbent MP actually faced the type of vote which Plett is bragging about.

Following up on this post on the general reason why I see per-vote party funding as a plus in the political system as a whole, let's turn to the NDP's strategic interests. I'll divide the question of the NDP's best possible strategy into two posts: first, a look at the impact of removing the public funding, and second, a look at how it fits into the messages the NDP should want to promote.

One of the main questions for the NDP in dealing with the per-vote funding has been that of how its strategic interests may be affected compared to those of the Libs. And indeed, part of the Cons' theory in raising the issue in their 2008 fiscal update was that the NDP might be willing to go along in the hope that the Libs would suffer more from their elimination.

But taking a closer look at how the parties are currently funded, I don't see much case to be made that the NDP actually does stand to gain from axing the per-vote funding.

In the Babble discussion on per-vote funding, JKR has already raised the point that at least in 2009, the NDP took in a higher proportion of its total income from per-vote funding than do the Libs. But the even more important comparison is Alice's multi-year comparison which also includes candidate and EDA fund-raising - and which shows the NDP and the Libs roughly on par in the proportion of their income from the funding even before the Libs' unusually high 2009 national fund-raising total.

In other words, there's absolutely no factual basis for the view that the loss of the per-vote funding would do more short-term damage to the Libs than the NDP. But would it present more of a long-term opportunity based on the NDP's having a stronger ideological message - in effect, that if the NDP puts more of a focus on fund-raising, it will enjoy greater returns than the Libs in doing so?

Sadly, the answer to that too seems to be "no". In fact, it's the Libs who spent proportionally less money to bring in their 2009 haul, suggesting that they can do more to ramp up fund-raising efforts without running into diminishing returns. And even if one substitutes in a more typical $6 million fund-raising take for the Libs, all indications suggest that they're still equal to the NDP in turning a dollar spent into a dollar raised.

So the argument that the NDP should see eliminating the per-vote subsidy as a means of gaining a competitive advantage over the Libs looks to be based on little more than conjecture and hope which isn't borne out by the parties' actual funding and fund-raising numbers. Which leaves the question of whether the NDP has some reason to want to echo the Cons' message on the subject, or whether it should instead look to use a defense of per-vote funding to reinforce its own messages.

It's bad enough that the Cons are pretending that the purchase of F-35s is a done deal even when there's no need to commit to them and every reason to think the cost will escalate. But perhaps the most noteworthy point to take from Winslow Wheeler's testimony is the fact that the stealth functionality in F-35s (which already makes no sense for any foreseeable use of the planes) will also result in their performing far worse than existing alternatives:

The F-35’s stealth features build into the aircraft weight and drag so severe that a hugely powerful engine gives the F-35 less rapid acceleration than American F-18Cs or F-16Cs, according to the data I have seen. The combination of the F-35’s considerable weight and its small-ish wings means it has a “wing loading” (and as a result maneuverability) roughly equivalent to an American F-105 fighter-bomber of the Vietnam era. The F-105 “Lead Sled” was notorious for its inability to defend itself over North Vietnam during the Indochina War.

In other words, the Cons' argument amounts to declaring we have no choice but to buy a platinum-plated, future-generation Hummer for Canada's city driving needs. Which, needless to say, rings rather hollow at a time when we're being told that lifting seniors out of poverty for a fraction of the price is somehow beyond Canada's means.